Apar Industries share price hits 20% lower circuit after Q3 profit sees 20% YoY decline

Stock market today: Shares of Apar Industries, manufacturer and supplier of conductors, cables, specialty oils, polymers and lubricants, tumbled 20% to the lower price band on Tuesday, January 28 following the earnings announcement for the third quarter of the financial year 2024-25 (Q3 FY25).

The company witnessed a decline in profit and EBITDA even as the revenue grew during the quarter ended December 2024.

Apar Industries witnessed a 19.7% year-on-year (YoY) decline in Q3 consolidated profit to ₹175 crore. Earnings before interest, depreciation, tax and amortization (EBITDA) post-open period forex declined 7.1% YoY to ₹ 401 crore. 

The decline comes even as revenue for the quarter increased by 17.7% YoY to ₹4,716 crore in Q3 FY25, with 31.8% growth seen in the domestic business. The export segment’s contribution to the overall revenue dipped to 33.5% during the quarter under review from 40.7% in the same quarter last year. However, the company said it expects the headwinds faced in the export business to reduce gradually.

Segment-wise performance

The conductor segment revenue witnessed a 23.4% growth in Q3, with volumes growing by 19% YoY. The Q3 order book remained strong at ₹7,601 crore.

The cable solutions segment also grew by 37% YoY, with domestic revenue up 30.4%. However, the speciality oils segment witnessed a slight degrowth in revenue of 0.6% YoY. That said, the volume for the segment in Q3 was up 4.8% YoY.

Management commentary

Commenting on the results, Kushal N. Desai, Chairman & MD of APAR Industries, said, “We have delivered yet another quarter of healthy revenue growth. We continue to lead the way in our premium businesses with a continued focus on innovation and a customer-centric approach. We remain optimistic that the domestic growth trajectory will remain unwavering, led by continued infrastructure capex spend. Headwinds we faced for the export business are expected to reduce gradually.” 

“On the margins front, we have seen a drop this quarter due to unfavorable competitive prices from China and lower demand from exports. We are hopeful that export demand will improve. Freight costs have started to soften, which should help reduce landed costs. However, on the back of our strong foothold in the energy infrastructure space, we remain confident and resolute in delivering long-term value accretion to our stakeholders,” Desai added.

Earnings Impact

Apar Industries share price slid sharply following the Q3 FY25 earnings announcement. On BSE, the stock hit the 20% lower price band of ₹7,172.60.

At 2.45 pm, the stock was trading 19.92% lower at ₹7180.

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